Debt & Public Finance

MANILA, Philippines— The Filipino people now have a tool to scrutinize debts acquired under their name. In 2017, the Congressional Oversight Committee on Official Development Assistance (COCODA) will launch an investigation on the legitimacy of at least 20 loans with debt service amounting to P7.6 billion. This came after almost a decade since the first debt audit provision in the national budget was vetoed by then President Gloria Macapagal Arroyo.

On December 22, 2016, President Rodrigo Duterte signed into law the P3.35 trillion budget for 2017 along with a special provision mandating the audit of the 20 national government foreign obligations that are being challenged by the Freedom from Debt Coalition (FDC) as illegitimate for being fraudulent, wasteful, useless, or environmentally and socially destructive.

“These are just 20 of the 481 outstanding regular foreign obligations of the national government, all of which should also undergo thoroughgoing audit and examination. But the presently mandated audit is an important first step towards a critical exhumation of this huge burden that has deprived the country of meeting its obligations on social protection and economic development for the people,” FDC President Eduardo C. Tadem said.

“We call on Congress to ensure transparency and extensive public participation in the debt audit so that we will finally be free from debts that we never benefited from and which effectively misappropriated the people’s resources to the point of social and economic neglect,” Tadem added.

Many of the loans being questioned by FDC were from the Asian Development Bank, the World Bank and the Japan Bank for International Cooperation.

FDC’s initial study shows that the borrowed funds were used for large infrastructure projects tainted with corruption, bloated budgets, violations of legal procedures, and used as lender’s conditionality for implementation of policies and programs that damaged our environment and distorted our development.

“We congratulate the Senators, particularly Sen. Risa Hontiveros who relentlessly pursued the inclusion of a debt audit provision in the 2017 budget, Finance Committee Chair Sen. Loren Legarda who supported the amendment, and Senate President Koko Pimentel who also co-introduced a separate resolution for a wider examination of foreign loans contracted in the last 15 years,” Tadem said.​FDC, however, wants to have the debt audit institutionalised so that it will not be constrained by the limitations of the General Appropriations Act.

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Freedom From Debt Coalition

The Freedom from Debt Coalition (FDC) – Philippines is a nationwide multi-sectoral, non-sectarian and pluralist coalition conducting policy advocacy work and campaigns to realize a common framework and agenda for economic development.